Re:Airbnb’s Stunning IPO
by solutron on Friday December 11, 2020 @10:44AM
(#25386965)
2x IPO strike price in first day of trading after $613M recouped stock options after the layoffs. Stock consolidation and 180 day lock up period creates a big risk for when employees sell. Lots of them probably have tens of thousands of shares, exercised them very cheaply, and will want to offload them. I'm not going to touch this stock with a 10-foot pole. I do wish I could short this stock but options aren't available for it yet.
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Everyone says this about the lock up and it makes sense intuitively, but it doesn't really match the data. I saw a presentation by a major investment bank that showed that in most cases there is not a significant drop following the lock up expiration -- I'm sure there are examples either way, but this was a compelling basket.
If the effect of early employees and investors selling after the lockup is significant, it wouldn't manifest itself as a drop after the lock up, it's a known date and it would be anticipated ahead of time by other investors and traders with the stock price reflecting this.
Fair point -- I should have been more clear, this analysis was based on comparing the post-lockup price to the first trade, and also to the primary offering price (not 180 days to 179 days). You'd sometimes see a drop from the "pop" price, although not always, and it would almost never fall below the primary price.
Re:Airbnb’s Stunning IPO
by milkshakes on Friday December 11, 2020 @10:56AM
(#25387114)
there is a 7 day exercise window currently in effect in which 15% of pre-tax awarded shares can be sold. early employees are able to sell, today through thursday. things look alright from here. there is another window for 25% after Q1 subject to performance. im not expecting a massive movement on the actual lockup expiration in may
Many brokerages allow you to short the actual underlying, without resorting to options.
This isn't possible so soon after the IPO as very few shares are currently available for shorting
Interactive brokers currently has over 280k shares available for short selling, at a fee rate of 0.25%.